
Since the announcement of the implementation of the regulation governing condominium syndicate attestation in the wake of Bill 16, several condominium stakeholders have questioned the relevance of the “Request for Information to the syndicate (DRCOP in French)” form formerly used by real estate brokers.
This document, which was only “recommended” by the OACIQ, was intended to facilitate the obtaining of information from the syndicate to enable the broker to more easily fulfill their advisory role to their client. However, the information required in the DRCOP form has grown over the years, leading to an increased risk of litigation for syndicates, as they were expected to provide information that was sometimes very specific or based on future estimates.
With the introduction of the Attestation, which came into effect last August 14, the use of the DRCOP will undoubtedly change, and this form may even be phased out. The AQGC predicted this change in its press release of May 26. Here are the main reasons for these upcoming changes:
No syndicate is legally required to complete the DRCOP form, although pressure from certain brokers on syndicates was such in the past that many directors and managers ended up completing the document instead of simply providing the seller and his broker with access to the information and documents required for the broker to take care of it.
The fact that the OACIQ structured the DRCOP form by requiring the signature of an authorized syndicate representative at the end also created a lot of confusion for syndicates who believed that this was an obligation, which is absolutely not the case. However, since directors and managers signed at the bottom of the DRCOP, in the event of a dispute, they were often the ones who were held liable.
With the introduction of the syndicate Attestation, the legislator clarified the information that a syndicate is required to provide in order to facilitate a prospective buyer’s purchase decision (1068.1 C.c.Q. and regulation). That said, a prospective buyer could ask the syndicate a range of other questions following a promise to purchase and the syndicate would then be required to provide the information in its possession, for a reasonable fee (1068.1 C.c.Q.).
In other words, the Attestation replaces the “standard information gathering” function that the DRCOP was intended to fulfill, but with a legal basis and specific requirements.
Another strong argument in favor of replacing the DRCOP is the inefficiency that results from the duplication of information that must be provided throughout the real estate transaction process. Many of the questions on the DRCOP are repeated in notaries’ questionnaires for all information specific to the condo unit, while everything related to the building is now also covered by the Attestation.
In addition, the cumulative costs (DRCOP + notary confirmation form + Attestation) place a heavy burden on the seller and cause frustration for syndicates/managers who receive multiple requests for similar documents.
One of the major issues related to the use of the DRCOP is the attribution of responsibility, which over the years has gradually been transferred from brokers to the syndicate or manager who completes and signs the form. Completing a DRCOP legally binds the person who signs it: in the event of an error or omission, the author could be targeted in a lawsuit.
The syndicate’s Attestation, on the other hand, is designed as a formal statement of the condition of the building and contains only objective information prescribed by the regulation. This protects syndicates and managers by setting limits on what is required of them.
Not to mention that with the advent of digital platforms in recent years, it is now possible to make information relevant to co-owners available to them (monthly condo fees, outstanding balances, violations committed, ongoing disputes, ongoing claims, etc.), thereby enabling brokers to more easily fulfill their duty of verification/interpretation towards sellers in order to properly complete the “seller’s declaration.” etc.) and thus enable the broker to more easily fulfill their duty of verification/interpretation towards the seller in order to complete correctly the “seller’s declaration” (or the equivalent of a DRCOP) as well as towards the buyer in order to guide them towards informed consent.
The Attestation thus helps to better define the roles of each party:
This adjustment in the distribution of responsibilities, made possible by the introduction of the Attestation coupled with the use of powerful cloud-based software, will give real estate brokers greater autonomy in their work to perform the necessary checks and analyses, thereby making it easier for them to fulfill their advisory role without the significant intervention of the syndicate that was proposed under the DRCOP. This is viewed very favorably by the condominium management industry and by syndicates, as the latter should effectively be facilitators of access to information, but should not play an active role in real estate transactions.
The Attestation is not a perfect tool and is not without its challenges, but it provides syndicates and managers with a clearer framework of what is expected of them, while facilitating the work of brokers. It is therefore recommended that syndicate directors and their managers, where applicable to:
If syndicates and managers adopt this stance now, the transition from DRCOP to Attestation will be smoother, and the market will adjust its procedures so that relations between stakeholders can once again become pleasant and cease to be conflictual, as has been the case in recent months when DRCOP was in high demand by brokers, often within unrealistic deadlines.
The arrival of the syndicate Attestation — the result of a known regulatory framework—marks a turning point in the transparency of condominium transactions. It clarifies what a seller must obtain from the syndicate, standardizes the information shared, reduces redundancies, channels responsibilities, and limits risks for syndicates.
This does not mean that the DRCOP will disappear overnight—particularly during the transitional phases—but its role as the “default” form is bound to fade, and brokers who want to continue to have it filled out by syndicates, even though the verification work is technically theirs, may eventually have to bear the production costs directly.
Elise Beauchesne, CPA, Adm.A
President and CEO
SolutionCondo
Commentaires
Il n'y a pas de commentaires pour le moment.